Van mileage benchmarks need adjusting to reflect actual vehicle usage

The commercial vehicle sector needs to take a more realistic approach to determining values for hard-used vans, instead of continuing to benchmark against unrealistically low mileages, according to EurotaxGlass’s, publisher of Glass’s Guide to Commercial Vehicle Values.

Most van manufacturers are primarily car-makers, and they typically calculate residual values for commercial vehicles against a three-year, 60,000-mile standard, having simply adopted this benchmark because it is familiar. However, there is a glaring inconsistency, given that the majority of panel vans are doing upwards of 30,000 miles a year, explains George Alexander, Chief Commercial Vehicle Editor at EurotaxGlass’s.

“The industry yardstick for average mileage falsely favours those less robust products that will survive intact to a modest mileage, but would fare far worse as the 100,000-mile mark approaches,” he says. “The need is to determine values for hard used vans at the end of a contract and not for the cleanest most popular models, with modest warranted mileage.

“It is plainly wrong-headed to continue to use such a yardstick when it does not reflect the norm. It is far better to use real-world data for high-mileage, ex-fleet vehicles, as is to be seen across the auction halls. Prices can then be adjusted upwards for those rare examples that are as clean as a whistle, having covered fewer miles, and will all but sell themselves.

“In the current marketplace, stock which has covered 60,000 miles or less is in great demand and will command strong prices. The danger is that, if an assessment of future residual worth for competing products starts from such a point, there is little chance that stock returning with 90,000 miles or more will have a chance of meeting vendors expectations,” concludes Alexander.